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Thursday, December 08, 2005
House Passes Major Tax Measures Yesterday
The House passed a number of tax bills yesterday. In total, they voted to trim $94.5 billion from federal revenue over five years. As Concord Coalition executive director Robert Bixby aptly put it in this Washington Post article, "I don't think it makes any sense to go through all the difficulty they just went through with the budget-cutting bill, then give it all back in tax cuts. If they want to cut taxes, fine, but they are going to have to cut spending by at least that much to help the deficit, and clearly they are not willing to do that. They have to start looking reality in the face."
H.R. 4096 passed by a vote of 414-4, and attempts to slow the expansion of the alternative minimum tax (AMT). It does this by extending the AMT exemption for one more year (adjusted for inflation). The bill costs $31.2 billion.
The second tax bill, H.R. 4440, passed the House by a similarly large margin with a vote of 415-4. The bill, which will cost $7.1 billion over five years, will provide tax breaks for businesses in the "Gulf Opportunity Zone." Thanks to the work of Frank Wolf (R-VA) and other House members, GOP leaders exempted casinos, country clubs, hot tub facilities, liquor stores, massage parlors, golf courses, racetracks and tanning salons from the tax breaks.
The final tax bill passed, H.R. 4388, will extend a provision allowing members of the military to use their combat pay to claim their earned income credit. The bill will cost $153 million.
The tax bills passed with broad bipartisan support and little mention of how the deficit will be impacted. The budget deficit is projected to reach $331 billion in FY '06 and remain above $300 billion a year through 2010, when most of Bush's tax cuts are set to expire. If the tax cuts are extended, these projected deficits will skyrocket above that figure.
CNN.com: House GOP Continues Tax Cutting Push
Posted by Becky Lewis
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